XBRL Is Here
XBRL (Extensible Business Reporting Language) is a technology standard that can be applied to the creation of financial statement data and other reporting situations. It is used for the reporting of business and financial information and can make the process of creating, distributing, reporting and analyzing information more efficient and effective.
XBRL is an application of XML to business information and uses tags or structure to describe the data, making it immediately reusable, interactive and intelligent. It is also “extensible” so it can be customized for unique situations and reporting concepts.
XBRL is NOT an accounting standard although it can be used to represent reporting concepts and provide an explicit link between certain concepts to the relevant accounting standard. XBRL is NOT a software program although it can be used to enable the seamless exchange of information between disparate software applications.
XBRL data is more robust, accurate, and transparent than data in financial statements that appears in legacy electronic and paper reports. Here’s why: in an XBRL financial report, each piece of data (both numbers and text) is given a unique ID, based on standardized lists of accounting terms, or taxonomies. For example, a data point of $200,000 might be linked to the accounting terms “U.S. Dollars,” “Net Profit,” “2nd Quarter,” “2006”. Once data is tagged, it is computer-readable. It can be identified, verified, extracted, and reused. The tags remain connected to the data, so even when the data is used in other XBRL software, it can still be understood in its original context.
XBRL tags both numbers and textual information, which means not only balance statements, but information such as statement of principals and even footprints, appendices, and updates, is accounted for, to aid in internal audits and external research and analysis
The global XBRL movement has ushered in a new age of financial reporting. XBRL often referred to as “Interactive Data”, gives the financial community a standards-based method to prepare, publish, exchange, search, and analyze financial statements of both public and private concerns – across all software formats and technologies.
XBRL standards have been mandated by various regulatory bodies throughout the world, and in December 2008, the U.S. Securities and Exchange Commission mandated its use by public companies and mutual funds for reporting financial statements.
XBRL frees data from paper-based reports and allows it to flow seamlessly between XBRL-enabled software applications. It automates financial analysis. Computers can intelligently “read” an XBRL report to select specific data, pull it into documents and spreadsheets, analyze it, exchange it with other computers, and present it in a variety of formats. This can all take place in real-time, allowing users to compare instantly hundreds of companies, industry sectors, topics, and issues, with automatic updates.
XBRL data is more robust, accurate, and transparent than data in financial statements that appears in legacy electronic and paper reports. For investors and analysts, XBRL eliminates the time, labor, and errors. XBRL tags both numbers and textual information, which means not only balance statements but information such as a statement of principals Moreover, footprints, appendices, and updates, is accounted for, to aid in internal audits and external research and analysis.